DreamWorks Animation signs with Netflix for $30mil a movie

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The New York Times writes about a streaming deal between Netflix and DreamWorks Animation. While it’s a great news — any additional content on streaming is welcome after that kerfuffle with price changes and all, I couldn’t help but notice that little analyst estimation of $30 million per picture per unspecified time period.

Now, analysts are often wrong, unless there’s some sort of a leak of the actual contract, but $30 million per movie? Now do you understand why Starz would spurn $300 million offer? Because they would be providing more than 10 movies in that streaming agreement. Even if that “unspecified time period” is 5 years, that’d still be $6 mil per movie per year, and Starz’ library is certainly large enough to exceed 50 movies.

Sure would like to know more about the financial part of the negotiation, but that’ll probably be understandable so other movie studios wouldn’t get over-excited about demanding the same amount.

And one more interesting twist — Netflix doesn’t require an exclusive right for the new movies, so DreamWorks will be able to sell the same content to cable companies too. Biggest loser is probably HBO, as they’re no longer exclusive partner, and if Netflix manages to pull in all other third party providers, people might get more inclined to pay Netflix and get all the same content + some extra B-movies than splurge on HBO (this, of course, excludes fans of HBO series).

Good work, Netflix.

p.s. Updated to clarify that this is about DreamWorks Animation
p.p.s. And do keep in mind, the streaming won’t start until 2013

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